Small Loans-I am BROKE!!!

Discussion in 'Teacher Time Out' started by VANewbie, Jul 18, 2010.

  1. VANewbie

    VANewbie Devotee

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    I am having MAJOR money issues. Major. I want to start grad school, I have bills coming from all over, I owe a lot of money. My teacher salary is not cutting it. I need a part time job but how will I manage a full time, part time, and full time in grad school?

    So I am thinking about taking out a small loan to pay all of smaller bills and just pay back the loan. Plus I am about to move into a cheaper apartment so I need money for the administration deposit.

    I am thinking about going to the local credit union to get a small loan and I have never done this before. I have excellent credit and I have a steady job. What would make them deny me a loan?

    Anyone ever have to do this? Advice?
     
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  3. czacza

    czacza Multitudinous

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    See what the rates are on a consolidation loan.
     
  4. mom2mikey

    mom2mikey Cohort

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    Do you have "lines of credit" down there? Can you not just get that set up with your bank account instead?
     
  5. VANewbie

    VANewbie Devotee

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    What is a line of credit?
     
  6. JustMe

    JustMe Virtuoso

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    Will you paying for grad school or loaning that as well? Is it a requirement?

    I don't have any experience with this type of loan, but I would speak to a financial advisor if possible before making any moves.
     
  7. VANewbie

    VANewbie Devotee

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    I will take out loans for grad school with the school. I am not worried about that because that is different. I just need a small loan to cover my new apartment deposits and pay off some of my small bills.
     
  8. Aliceacc

    Aliceacc Multitudinous

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    Why not put grad school on hold for six months or a year? That will enable you to put in more part time hours,and not go crazy trying to be everywhere at once as you get things together.
     
  9. VANewbie

    VANewbie Devotee

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    :(
    I just know that putting off grad school puts me farther behind in earning more money in teaching. I really need to get started now.
     
  10. DrivingPigeon

    DrivingPigeon Phenom

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    I did something similar last year. I was moving out of my apartment (which I lived in with my then-boyfriend, but we broke up and he moved out and I couldn't afford it on my own) to a cheaper apartment. However, to move into a new place I had to have a $300 security deposit, $500 cat deposit, and $535 for the first month of rent. I ended up taking out a $1,500 loan from my credit union. It's an 18-month loan and I pay $92 per month. I didn't want to take the loan out, but my apartment was too expensive and I had no savings.

    I asked them if I could possibly put some of my credit cards on the loan, too, to pay them off. Even though I have ok credit and I've been a member for 10 years, the loan lady said no, because $3,000 was too much for an unsecured loan.

    I'm not sure if your situation would be the same, but that's what happened when I tried.
     
  11. VANewbie

    VANewbie Devotee

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    Your situation sounds a lot like mine. I have to come up with a lot of money for this apartment. My credit cards are pretty small. I may not even take a loan out for them. I guess I just need money for the apartment and I have to pay 600 for something else up front.

    I thought that getting a full time job would help me out and I would be in a better situation than I was in college. Its not true. I don't teach for the money but why can't teachers get paid more. I am struggling. I can't save and I just feel like I will need a MAN(spouse) to support me because I will never be able to get ahead.
    I am so frustrated right now.
     
  12. TeacherApr

    TeacherApr Groupie

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    i feel grad school should be the last on your list of priorities. Get that 2nd job and start paying off bills first. Getting more loans is only contributing to the problem.
     
  13. mmswm

    mmswm Moderator

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    It works pretty much like a credit card, but without the plastic. It's revolving credit that you can advance from, then pay back in monthly installments. The amount of money you can advance is the difference between your current line balance and your credit limit.

    LCA's typically have lower rates than fixed installment loans (ILA) because they're typically variable rates vs fixed rate loans. This can work for you or against you, depending on how much the prime rate changes. Unsecured debt generally carries a higher rate than secured debt. The cheapest money you can get would be a secured LCA. If your bank or credit union will allow you to secure an LCA or ILA with a savings account or CD, you're even better off, since the money in the savings or CD is also earning interest, slightly offsetting the interest you're paying.

    To answer another quesiton...why would they deny a loan? With excellent credit, one they could deny you is your Debt to Service ratio (DSR). This is a ratio of what you owe, or could potentially owe relative to what you make. They take all your monthy payments (or what they would be if you maxed out your credit cards), plus your housing payment, car payment, then divide that by what you make. That number needs to be under whatever your lender's underwriting guidelines state.

    Another reason they could deny you is if the proportion of balances to limits on your current credit cards are too high. If you're at or near your max on all your cards, that makes a lender think you're living beyond your means, and thus puts you in a higher risk category.


    Beyond just being approved, you also need to look at the rate you're offered. They might not offer you the best terms available if any of your indicators put you at a higher risk, but not outside of underwriting guidelines. When you apply for a product, ask for what the floor rate for the product is, and if you don't qualify for that rate, ask why.
     
  14. MissCeliaB

    MissCeliaB Aficionado

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    When my husband was doing grad school, he took out a student loan that was big enough to cover his living expenses as well. Your loan can be for more than the amount of tuition.
     
  15. dizzykates

    dizzykates Habitué

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    Honestly, even if I could get the loan, if I were in the position to need a loan like that, I would not be starting graduate school. Do you have undergraduate loans? Adding to those my taking out graduate loans seems really overwhelming to me.

    I understand it is a pay raise, but is it possible to take a couple classes instead of starting the whole program? I know I was able to take 4 classes and get a raise the following year. It allowed me to start slower, pay cash, and stop when I got my raise. I waited three more years and now I am able to pay for the remainder of the program in cash (I fulfilled the elective requirements).


    I would focus on finding a part time job and get into the smaller apartment and then wait it out. The economy is so fickle right now that if you have a graduate degree and experience you may not get another job if you get let go from this one. Is this job year to year or are you tenured?

    As far as "needing a man to support you", yes it is possible a man might make more than you if he is not in teaching, but that doesn't mean your situation will improve. He might have a higher cost of living or more loan debt to accompany that larger salary.

    I understand your feeling though, my husband and I are very comfortable with our current situation which still only involves a small townhouse, one old car, and one newer car. We have undergraduate debt, but are paying for graduate school in cash and I cannot tell you how freeing it is to know that my raise this fall is 100% mine because I don't have to use any of it (or all of it) to pay back a loan. If I wasn't married it would be impossible for me to replicate this situation, I didn't even qualify for our stupid car loan on my own (and I promise, it wasn't a huge loan) even though I have great credit. It is frustrating!!

    Have you talked with a financial advisor or set up a budget? There are many tools online to help with that if you want to try it on your own before paying someone, but I highly recommend it if you haven't.
     
  16. DrivingPigeon

    DrivingPigeon Phenom

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    DITTO! I feel like I was better off in college. I was working 2 jobs, but probably making around what I make now!
     
  17. janlee

    janlee Devotee

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    Have you looked closely at how much your salary will increase when you have your masters? How long will it take you to recoup your initial output to complete your graduate work? Are you secure in your current job? If not, having a masters and having to look for a new position may not put you at the top of the list as you will be asking for a higher salary than a new teacher. On my pay scale there is about an $6000 difference between a BA and an MA. Does your district increase your salary as you move to BA+15, BA+30 etc? Personally I would want bills paid before adding to debt. Debt causes stress as often does your job and personal life. I would do a long term analysis before beginning in this direction.
     
  18. ku_alum

    ku_alum Aficionado

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    What about a roommate to split costs on the apartment?
     
  19. Ms. I

    Ms. I Maven

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    I completey agree, although I realize that the sooner you get your Masters, the sooner you'll have that higher salary.
     
  20. leighbball

    leighbball Virtuoso

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    In all honesty, grad school is what put me over the edge and started my debt. granted I was dumb and didn't apply for a loan, but I bought a new car and my condo and started grad school all in less than 12 months. My then-bf (now dh) had to move in with me to help with finances.

    I was lucky because I jumped up 5K when I got my masters...however, not taking care of the bills I had before starting grad school coupled with the money I put out for grad school hurt me more than helped me.

    I know in another thread you were asking about when to start grad school. If money is this much of an issue, I would definitely wait until spring semester when you can be considered an in-state student and your bills can be a little more under control.

    :hugs:
     
  21. VANewbie

    VANewbie Devotee

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    My credit card bills are pretty low. I can actually pay those off a little at a time.

    The loan, like I mentioned will be used for this apartment.

    As for grad school....my undergrad loan are over 40,000. So getting a part time job to pay that off its going to take a lifetime. My plan is to get into grad school which will take 2 1/2 years and defer my loans if needed. I will have to take out loans for the grad school. Its just soo much undergrad that won't be able to be paid in the next few years.

    With the masters I will get about 4-5,000 more. Which instead of having only less than $200 at the end of the month for food and gas I will have $500. That will be a world of difference for me.

    So I HAVE to get the small loan tomorrow for the apartment. There is no other way around that. I need the money, I don't have it and I need the apartment. My mind is just set on grad school to get the process started. Since it will take me close to 3 years to finish I will be in my 4th/5th year of teaching by then.
     
  22. VANewbie

    VANewbie Devotee

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    Thanks. If it is true that I will be listed as out of state I will wait.
     
  23. Kat53

    Kat53 Devotee

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    Until I formed a plan of how I was going to get out of debt, I continued to struggle with finances. I'm afraid you might be getting yourself into a cycle of debt by borrowing money to pay off other debts. I'm saying this because, trust me, I've been there. I by no means have my finances straightened out, but I had to work out a plan. I started saving money for an emergency fund ($1000) then attacked debt with a vengeance. I sold some clothes. I got a part-time job. I also worked full time and tutored plus having my other temp job. Your masters is important, but I agree with others that it might be best to put it off for a year.
    It seems like there are so many threads about money issues now. It is a hard time. I've said this before in other threads but Dave Ramsey's class Financial peace University gave me a plan. He is an expert on finances and he tells it to you straight. Google the class to see if there is one in your area.
    Right now I pay around $800/month in debt from my car, student loans, and credit cards. I cannot WAIT until the day I pay those off. I'll have so much more money to save.
    I really, really understand your struggle and the stress it causes.
     
  24. TeacherApr

    TeacherApr Groupie

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    TRUE, BUT.....is the raise over and above the amount it will cost you to go into further debt? In my area it is not worth it.
     
  25. VANewbie

    VANewbie Devotee

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    Reading my last post^^^^^ and hearing your thoughts makes me want to cry. I don't know what to do! I don't know what to do. In my real life outside of this forum people keep telling me to start grad school NOW so I can have more money to focus on my bills. I'm so sad. I have tears coming down my eyes.
     
  26. leighbball

    leighbball Virtuoso

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    Ok, let's think about this...(and you don't have to answer these questions...just something to think about)

    How much money do you are have in loans and debt now?

    How long will it take you to complete a master's degree?

    How long will it take you to pay off your school loans PLUS the other debt you have?

    One other thing to consider...your situation may change at the time when you get your masters degree and your money will still be needed elsewhere.

    Here's my example: like I said earlier, I spent too much too quickly and suddenly had trouble paying all of the bills without going into massive debt, which is when dh moved in. I too was sooo excited about the jump in salary. And you know what? The day after I finished my last graduate class, we got engaged and suddenly money went towards the wedding. Then dh needed a new car. Now I'm pregnant.

    You may not be in a situation like me, but its just something to think about...you may be in a very different situation when you finish your degree than what you think.
     
  27. mmswm

    mmswm Moderator

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    Okay...take a step back from all of this. Yes, you're going through a difficult time, but you can get through this.

    Money and finances are all a numbers game. It's time to play. Here's how to play:

    Part I
    1) Collect your recepits for a week. Don't miss anything....even if it's only for 6 cents, add it in. If you go to a vending machine, write up your own receipt. Add up your spending and multiply by 4.3.
    2) Sit down with your monthly bills. Add them up.
    3) If you have bills that are less frequent than monthly, divide by the appropriate number (ex: I pay my car ins every 6 months...I would divide that amount by 6).
    4) Add it all up. This is your total outgo.

    Part II
    -Itemize all those reciets. Is there anything you spend money on that you could do without?
    -Look at your monthly bills. What can you do to reduce those?
    -Look at your living habits. What do you do that makes life more expensive. Change your habits to lower your expenses

    Part III
    -Make your money work for you!!!!
    --This is where you're getting conflicting advise. Look at the cost of grad school vs. the increase in pay. Don't just look at the cost of tuition. If you have to take loans to pay for it, add in the finance charges. Compare that cost to the increase in pay you will get for having that degree. How many years will it take to earn back the investment capitol you put into yourself? 5 years? 10? 20? At what point do you say it's not worth it? That's a personal question, but you need to answer it.

    --How much are you paying in finance charges for your current debt? Would it be better in the long run to throw more money at that, eleminating the extra costs first, before you start grad school?


    --Do you HAVE to start grad school now? Is it require to keep your certification? Are there any negative consequences of not doing it, other than delaying the potential increase in salary (which may or may not be comepletely negated by the cost of getting said degree)?


    Think about all these things, then make the decision for yourself. It's a personal decision. We could all tell you our opinions, but in the end, you have to make the choice for yourself, according to your own values and personal situation.
     
  28. VANewbie

    VANewbie Devotee

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    MMSWM-Thank you. You all have given me something to think about. I have to come back to this thread later. I can't think about this anymore.
     
  29. Kangaroo22

    Kangaroo22 Virtuoso

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    I know that you're really stressed out right now, but looking into getting a part-time job to help you save up some money is probably a good idea. It could also help you to easily pay off your loan or the apartment. Just by working weekends you could easily make $100 extra a week after taxes, which would be $5000 a year. There are some really low-stress retail, hotel, etc. jobs out there (I work in a grocery store and usually my eight hour shifts fly by) that would give you some breathing room financially.
     
  30. JustMe

    JustMe Virtuoso

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    I must be honest...I asked about whether obtaining your advanced degree was a requirement because, like others, I would hold off for at least another six months. Just to get things in better order...not until everything is just so, but until you have a system you're working within. I'm so sorry for your difficulties. I understand it's stressful.

    Because I was apparently supposed to be independent fresh from the womb, I had to live in government housing for a little less than a year when I was eighteen/nineteen, I think it was, until I had things in better order. Is that a possibility? My rent was around $150 per month.
     
  31. wdwteach

    wdwteach Cohort

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    Do you have a Teacher's Credit Union? They are very helpful with small loans, car loans,... mine had the best rate by far for my car loans.
     
  32. INteacher

    INteacher Aficionado

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    And not to be a Debbie Downer, but you also need to make sure you'll even get your step. Many school districts not only froze pay recently but they also froze steps. So there might be a possbility of obtaining your masters but not getting paid. Check into your district to make sure steps aren't frozen
     
  33. VANewbie

    VANewbie Devotee

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    What does that mean exactly. So if they froze steps for 2 years and I got my masters in two years I wouldn't get masters pay?
     
  34. INteacher

    INteacher Aficionado

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    That is what it means in my district.

    If steps are frozen for two years, you would recieve masters pay at the beginning of year three.
     
  35. JustMe

    JustMe Virtuoso

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    Yes, that is what it means in too many districts right now. :(
     
  36. VANewbie

    VANewbie Devotee

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    I'm looking it up right now. I think our pay is frozen but not our steps.
     
  37. FarFromHome

    FarFromHome Connoisseur

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    Yes. I just finished my Master's, but won't get paid for it next year because of a pay freeze.
     
  38. bros

    bros Phenom

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    I will PM you a guide I found once about debts.
     
  39. VANewbie

    VANewbie Devotee

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    UPDATE***

    So I ended up getting that small loan and getting the apartment. Once it gets even close to me moving I have to pay more deposits but I will worry about that when the time comes.

    I am just trying to stay positive and pace myself. I am trying to figure out a budget and see where my money is going but its going to be hard. Its like when you don't make anything how can you ever save anything and budget. I am struggling now.

    As for grad school I'm trying to get the instate tuition squared away. We will see what happens in the upcomming weeks.
     
  40. leighbball

    leighbball Virtuoso

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    Congrats on the apartment and good luck with everything!
     
  41. gigi

    gigi Groupie

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    Thinking of you, keep us posted on your progress.
     

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